The 2026 World Economic Forum in Davos, Switzerland, witnessed an exceptional appearance by US President Donald Trump, who used the platform to announce what he called a "new golden age for the American economy." In a speech lasting over an hour, Trump emphasized that his policies of tax cuts and deregulation were the main reason for the resilience of the US economy in the face of global shocks. However, this speech did not go unnoticed by the leaders of participating countries and international organizations, who see the return of protectionist policies as a threat to the stability of global supply chains.
US Growth vs. Public Debt: Despite the positive figures Trump presented regarding declining unemployment rates, economists behind the scenes at Davos warned of the "ticking time bomb" of US sovereign debt, which has reached historic levels. Relying on borrowing to finance tax cuts could, in the long run, weaken the dollar and raise borrowing costs globally. This article analyzes how global markets have already begun to hedge against the possibility of another interest rate hike by the US Federal Reserve to counter potential inflation resulting from the tariffs Trump threatened to impose on imports.
Trade War and International Responses: A key theme in Trump's speech was the focus on rebalancing trade with China and the European Union. Trump believes that current agreements are "draining American wealth," while the European side argues that any additional tariffs will lead to a full-blown trade war that will harm everyone. In this context, China emerges as a player attempting to fill the void that the US withdrawal from some trade blocs might leave, thus redrawing the map of global economic power.
The Future of Investment Amid Uncertainty: For investors, the key word at Davos 2026 is "uncertainty." While the US administration promises a favorable business environment, geopolitical tensions and the threat of sanctions raise concerns about sharp fluctuations in global stock markets. This article reviews analysts' recommendations to diversify investment portfolios and focus on safe assets or markets that demonstrate political and legislative stability, remaining largely unaffected by major power conflicts.
